2017 (9) TMI 537 - AT - Customs

Valuation - imported PVC Sheets - The importer admitted that the value of imported goods were not correct and the correct value is much higher than what is declared - inclusion of freight - Held that - The facts of the case are not in dispute that the goods which are imported were not assessed to proper duty was admitted by the import themselves. Based on the particulars and details given by the managing director of the importing company, the valuation including freight element was considered by the assessing officer before calculating the differential duty - Since the correct value is only in the knowledge of the importer and is not arrived based on certain materials collected by the Revenue from third party sources, we are not finding any force in the submission of the appellants which is against their own submission made before the lower authorities. On merit as well as on imposition of penalties and fine we are in agreement with the impugned order - The penalty should be equal to duty only and cannot include interest portion of such duty - appeal dismissed - decided partly in favor of appellant.

Summary

Issues:
1. Valuation of imported goods for duty purposes.
2. Confiscation of seized goods and imposition of penalties.
3. Reduction of redemption fine.

Issue 1: Valuation of imported goods for duty purposes:
The case involved the import of PVC sheets where the appellant admitted that the declared value was incorrect and much lower than the actual value. The Revenue calculated the differential duty based on information provided by the importing company's Director. The original authority found the declared value to be inaccurate and imposed penalties under Sections 114A and 112 of the Customs Act, 1962. On appeal, the Commissioner upheld the original order, except for reducing the redemption fine. The appellant argued that the valuation by the Department was incorrect and lacked supporting evidence. However, the Department contended that the valuation was based on details provided by the importer, who also paid the differential duty and interest. The Tribunal noted that the correct value was known only to the importer and upheld the valuation adopted by the assessing officer, dismissing the appeal against their own submissions. The Tribunal reduced the penalty under Section 114A to be equal to the duty, excluding the interest portion.

Issue 2: Confiscation of seized goods and imposition of penalties:
The impugned order upheld the confiscation of seized goods and imposition of penalties on the appellant and the Managing Director under Sections 114A and 112 of the Customs Act, 1962. The appellant argued that the penalties were excessive and should be reduced. The Department justified the penalties based on the importer's admission of undervaluation and intention to pay fines and penalties. The Tribunal found no merit in the appeals, agreeing with the impugned order's findings on the valuation, penalties, and confiscation. However, it modified the penalty under Section 114A to exclude the interest portion, reducing it to be equal to the duty.

Issue 3: Reduction of redemption fine:
The Commissioner reduced the redemption fine imposed on the appellant from ?5 Lakhs to ?3.5 Lakhs. The appellant sought further reduction or setting aside of the penalties imposed. The Department argued that the appellant had provided valuation particulars and paid the duty and interest as per the details submitted. The Tribunal found no grounds to interfere with the impugned order's findings on the penalties and fines, except for modifying the penalty under Section 114A to exclude the interest portion. It dismissed the appeals while reducing the penalty to be equal to the duty, as per the Customs Act, 1962.

This detailed analysis of the legal judgment in the case involving the valuation of imported goods for duty purposes, confiscation of seized goods, and imposition of penalties provides a comprehensive understanding of the issues addressed and the Tribunal's decision on each aspect of the case.